Monday, 22 December 2014

With equities continuing to broadly climb, the VIX naturally was still cooling, settling -7.5% @ 15.25. Near term outlook offers the sp'2100s, which will likely equate to VIX ending the year in the 12/11s. VIX 20s look highly unlikely until late Jan/early Feb.

US equities closed higher for a fourth consecutive day, the sp' +7pts @ 2078. The two leaders - Trans/R2K, settled higher by 1.0% and 0.5% respectively. Near term outlook is for the sp'2100s, Dow 18000s, with VIX falling back to the sub-teens.

sp'60min

Summary

*as has often been the case, the more dynamic action was in the commodity sector, esp' in energy and the precious metals.
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There really isn't much to note, in what will be a very quiet holiday week. Tuesday will likely be the last 'moderately' active day of this week.
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Despite some notable weakness in the energy sector, the broader market looks set to close higher for the fourth consecutive day. Metals remain weak, Gold -$20. Oil is significantly lower, -4.4%, but holding above last weeks low of $53.60.

sp'60min

Summary

*notable weakness in the metals... and this is really causing problems for GDX -5.2%, the $16s look due this week... and perhaps new multi-year lows, as early as this Friday.
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So... as is often the case in this market.. rather than a down wave.. .the retraces are more about chop or merely 'gains.. but slightly less than before'.

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The sp'2100s look on track before year end.. along with VIX 12/11s.
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The bigger issue is what will many say when the R2K breaks >1213... and proceeds into the 1300s?
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back at the close

Whilst the main market is holding gains - especially in the Dow, there is notable weakness in the precious metals. Gold is lower by a rather significant -$20, with Silver -2.6%. This naturally impacting the miners, the ETF of GDX -4.7%. Outlook is bearish into year end.. and beyond.

GLD, daily

GDX, daily

Summary

Interesting day in commodity land, with sig' declines in not only energy.. but now also the metals.
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Other than that... its merely a day of consolidation after last weeks hyper-ramp from sp'1972/2077.

US equities remain in relative chop mode... with a touch of underlying weakness.. notably.. energy sector. Metals are on the slide.. Gold -$12. which is naturally impacting the miners, the ETF of GDX -2.9%. Oil remains weak, -4.2%, but still holding last weeks low.

sp'60min

GLD, weekly'2

Summary

There isn't much to add on the main market. Hourly indexes are still suggestive of a minor down cycle into early Tuesday, but in many ways.. that will probably be price consolidation.. than an actual fall.

Whilst the main market is holding minor gains, there is notable weakness in the VIX, which is in classic 'holiday melt mode', already -4% in the mid 15s. The sub teens look an easy target by year end. Meanwhile, energy remains weak, Nat' gas -7.6%, whilst Oil -3.6%.. but the latter is holding last weeks low.

VIX'daily3

USO, daily'2, rainbow

Summary

*a fifth blue candle for Oil. I could understand some would call price structure a bear flag, but I believe Oil is merely building a floor.
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Little to add....

The hourly equity cycle is suggestive of weakness into early tomorrow... so.. those looking to buy.. probably have a better opportunity tomorrow.
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US equities open a little higher, but the gains look shaky. The smaller 15/60min equity cycles are rolling over - especially in energy, and look set for weakness into early Tuesday. Energy prices are strongly lower, Nat' gas -8.8%, with Oil -3.1%.

sp'60min

Summary

So... opening minor gains, but market looks a touch vulnerable into early tomorrow. Regardless... trend into January is strongly higher. The sp'2100s are coming.

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With Nat' gas getting smashed (or should that be exploded?)... stocks like CHK are seeing very significant opening declines of 5-6%...

CHK, daily

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To be clear, I do NOT expect new cycle lows in energy (whether ETFs like ERX), or Oil itself.. which should comfortably hold last week's low of $53.60.

Good morning. Futures are moderately higher, sp +4pts, we're set to open at 2074. Metals are a touch higher, Gold +$2. Energy is very weak, Nat' gas -6.2%, with Oil -1.8%.

sp'daily5

Summary

Welcome to Christmas trading week! Effectively, just 3.5 days to get through.. and no doubt Wed' and Friday will be super quiet... so really, the only decent opportunity for price action will be today and tomorrow.

Daily MACD (blue bar histogram) cycles are due to go positive today for most indexes and thus underlying price inclination will remain to the upside for today.

Hourly cycles are offering a down cycle into early Tuesday, but really... any weakness will be minor... and by end week... new highs.
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